Saturday, September 23, 2000
Insurance method deemed 'unfriendly'
The Associated Press
FRANKFORT — State insurance officials Thursday criticized as “unfriendly to consumers” the way in which health insurance was sold to students at Western Kentucky University.
Unless coverage was specifically waived, students were automatically charged in their tuition.
“It puts the burden on the student and parent to stop the coverage or you're going to pay for it,” Department of Insurance spokesman Roger Snell said.
An attorney for the company said it actually is the accepted way of selling student plans.
“Is it unfriendly when this is the way insurance is sold nationally?” Peter Carpentier, general counsel for The Chickering Group, said.
Western provided for a “soft waiver,” meaning coverage could be rejected outright. Mr. Carpentier said many other universities impose a “hard waiver,” meaning the insurance can be rejected only if the student has comparable coverage from another source.
Fred Hensley, a spokesman for Western, said the university “in the future will use something other than the soft waiver because it was confusing.”
Chickering, based in Cambridge, Mass., was a third-party administrator for Aetna U.S. Healthcare. Aetna supplied coverage, and Chickering handled enrollment and claims.
However, Insurance Commissioner George Nichols said Chickering was not licensed to do business in Kentucky as an agent or a third-party administrator. Chickering now cannot do business in Kentucky until licenses are granted, a Department of Insurance statement said. The department also fined Aetna $10,000 and Chickering $8,000.
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